“It will be Treasury’s choice as to when they want to
liquidate” their shares, AIG Chairman Steve Miller said in a
Bloomberg Television interview. “But it is certainly within the
realm of possibility that it could happen within the next 12
months.”

Chief Executive Officer Robert Benmosche, 67, has
repurchased shares from the government to help the company
regain independence from its rescue and improve return on
equity. New York-based AIG bought back $3 billion of stock from
the Treasury last month at $29 a share as the department sold
the same amount at that price in an offering to investors,
cutting the U.S. stake to about 70 percent.

“We’re getting a lot closer to that point that we will
have paid back every penny that taxpayers put into this company,
plus a profit,” Miller said today in the interview in New York,
where AIG is based. Matthew Anderson, a spokesman for the
Treasury, declined to comment.

AIG may generate funds for buybacks through distributions
from subsidiaries and additional asset sales, including the
lowering of a stake in Hong Kong-based insurer AIA Group Ltd. (1299),
Deutsche Bank AG’s Josh Shanker said in a note to clients last
month. The analyst estimated that the company could repurchase
$15 billion to $20 billion of stock in the next year.

AIG slipped 2.3 percent to $32.48 at 4:15 p.m. in New York.
The U.S. needs to average at least $28.72 on its share sales to
recoup taxpayer funds.

The insurer was rescued in 2008 in a bailout that swelled
to $182.3 billion. The lifeline included a $60 billion Federal
Reserve credit facility, a Treasury investment of as much as
$69.8 billion and up to $52.5 billion to buy mortgage-linked
assets owned or backed by AIG. The insurer has repaid the credit
line. The Treasury’s stake, once more than 90 percent, has been
lowered through share sales.